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Union Warns Against Privatizing Grain Inspection

Grain is one of the leading agriculture products in America, and as Congress works on reauthorizing the U.S. Grain Standards Act, one union warned Wednesday against privatization.

Currently, federal civilian employees with the USDA’s Federal Grain Inspection Service (FGIS) are responsible for inspecting grain. J. David Cox Sr., president of the American Federation of Government Employees (AFGE), is urging congress to keep it that way and resists any attempt to privatize grain inspections as they consider reauthorizing the Grain Standards Act

“Privatization of FGIS would undermine America’s guarantee of impartial and honest, government-backed trading which is relied upon by world buyers,” Cox testified before the House Agriculture Subcommittee on General Farm Commodities and Risk Management.

During the hearing, Cox said that privatization would be a step backwards to a time when private industry almost ruined the grain market.

“We have come a long way since the 1970s when a wholly privatized inspection process yielded a series of scandals that undermined confidence in the quality and quantity of U.S. grain exports,” he said. “Scandals which many believe contributed to a crash in grain prices in the middle of the decade, farm foreclosures, and the loss of significant numbers of family farms.”

“The mandatory inspection of U.S. grain exports benefits the entire grain marketing chain, from farm gate to export,” Cox said. “It is imperative that lawmakers not allow empty ideology, short-sighted financial interests, or anti-labor animus to trump the nation’s interest in ensuring impartial and honest inspection and weighing of its grain exports.”

However, Nick Friant, who testified on behalf of the National Grain and Feed Association (NGFA) and the North American Export Grain Association (NAEGA), said that allowing outside qualified personnel could actually strengthen the federal system by allowing third parties to assist in certain operations, especially when it comes to ensuring operations continue in case of disruptions. He says its plan has been attacked as a privatization scheme when it’s more an effort to allow partnerships with existing federal processes.

“That emphatically is not what NGFA and NAEGA are proposing,” Friant declared before the committee. “Instead, what we propose is a process to further strengthen the federal system we seek to improve and preserve by enabling qualified individuals working under federal oversight and employed by independent, private third parties to be licensed.”

Friant also argued that the FGIS should base weight and shipment fees for grain on a fluctuating and more market responsive basis that “takes into account shifts in actual shipment volumes that are officially inspected, rather than the current static formula that is based on what were erroneously low projections in export volumes.”

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